Tax relief on contributions

You may get tax relief on contributions to approved personal pension arrangements. This relief is more generous as you get older. Since 1 January 2011 you pay PRSI and the Universal Social Charge on your pension contributions.

 

Age Amount which qualifies for tax relief
Under 30 years 15% of net relevant earnings
30 to 39 years 20%
40 to 49 years 25%
50 to 54 years: 30%
55 to 59 years 35%
60 and over 40%

The maximum amount also applies to people in certain occupations and professions, irrespective of age where there is a limited earnings span. These occupations include professional athletes.

There is a limit on the earnings that may be taken into account. The limit is €115,000.

You no longer have to buy an annuity with the proceeds of your pension policy, however, you may do so if you wish. This option does not apply in general to occupational pensions, but it may apply to the Additional Voluntary Contributions (AVCs) paid by people in occupational pension schemes.

 

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